"A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an outsider in our business. He is part of it. We are not doing him a favor by serving him. He is doing us a favor by giving us an opportunity to do so." - Mahatma Gandhi
Technology and Innovation have created new platforms within which the consumers are benefited in many ways. However, the main concern for the growth and development of business, and the service sector is the protection of the consumers.
This article will analyze the concept of consumer protection and the laws relating to consumer protection in the UAE.
Before we delve into the concept of consumer protection, let us examine the meaning of the term consumer:
The term 'consumer' denotes a person who purchases a product or service for a personal purpose. The consumers are the backbone of a market, and they play a vital role in the economic development of a nation.
The European Union Law defines the term 'consumer' as the following:
"A consumer is a natural person, who is acting outside the scope of economic activity (trade, business, craft, liberal profession)."
The definition of the term exhibits that the term refers to individuals who consume the product or service for their personal use and not for the engagement of any particular trade or business. Therefore, consumers are the end users of the product or service obtained. Although the terms 'purchaser,' customer and prosumer may seem similar, there lies a line of demarcation between them.
Difference between Customer and Consumer
We often use the term consumer and customer interchangeably without understanding the minimal difference between them.
A customer is a person who purchases a product or service. He may or may not use the product for his consumption, and may also use the product as a raw material for the production of the finished material. Whereas on the other hand, a consumer is the one who consumes or uses the product or service.
Now the self-help movements have led to the formation of a new word 'prosumer,' which is a combination of both consumer and producer. American writer Alvin Toffler coined the term 'prosumer' in 1980. The term 'prosumer' refers to an individual who produces as well as consumes a product.
The consumer is an essential part of an economy without which there won't be any growth in trade and business sector. Now the protection of consumers has become an integral part of the law. Consumer protection laws have been enacted to protect consumers against unsafe and unfair practices. The enactment and implementation of consumer protection laws serve as a watchdog on the producers thereby safeguarding the interest of the consumers.
Since all the activities relating to business are run primarily based on the consumers, it is necessary that every country implement legislation to protect the consumers. Such legislation ensures that business is run without any fraud or unfair practices.
For example, in many countries, the consumers purchase vegetables from the local market or store without being aware of the quantity or quality is given by the shopkeeper. They believe the measure to be accurate and may make payment without any query even if such product is adulterated. In such instances, the consumer protection laws protect the consumers against such unfair practices and grant them the right against the violation.
Need for Consumer Protection
" The consumer is the supreme mover of economic order... for whom all goods are made and towards whom all economic activity is directed" - Kenneth Boulding
The consumption by the consumers has a significant influence on the market of a nation and, since consumers are considered to be frail compared to their counterparts (producers), there is a high chance that the consumers are exploited to meet the interest of the producers.
Apart from the above mentioned, a consumer protection law is required for the following:
- Fair market- The implementation of consumer protection laws provide for the promotion of a fair and accessible market.
- Increased standards- consumer protection laws provide for improving the standard of goods and services.
- Economic Growth- The laws protecting consumers help in the growth of the economy by preventing unfair practices.
- Effective transaction system- It helps in the promotion of an active transaction system.
- Unity- Promotes unity among the consumers for fighting against the producers who violate the law.
- Ethical Standpoint- Satisfies the moral obligations of a business.
- Redressal of Complaints- The consumers can approach the concerned authorities for assurance of justice.
International position of Consumer Protection
Consumer protection is achieved by setting the minimum quality standards of protection. Most of the nations have adopted adequate measures for establishing mechanisms to protect the consumers.
The protection of consumers at an international level was brought into force for the first time in the United Nations Guidelines for Consumer Protection (UNGCP) in 1985. The guidelines provide the basis of consumer protection in numerous countries. Therefore, the members of the convention are to adhere to the guidelines.
Part II of the UN Guidelines for Consumer Protection lays down the general principles, and it states:
"2.Governments should develop or maintain a strong consumer protection policy, taking into account the guidelines set out below and relevant international agreements. In so doing, each Government should set its own priorities for the protection of consumers in accordance with the economic, social, and environmental circumstances of the country and the needs of its population, bearing in mind the costs and benefits of proposed measures."
Consumer Protection in the UAE
The UAE, being the focal point of business in the Middle East, various steps have been taken by the government for the protection of consumers. These measures have been adopted by the government to increase the confidence of the consumers and to maintain fair practices in the market.
The Federal Law Number 24 of 2006 deals with Consumer Protection in the UAE, and for implementation of the provisions, the Department of Consumer Protection has been established under the Ministry of Economy.
According to the Federal Law Number 24 of 2006, a consumer is defined as the following:
"An individual who acquires Goods or Services, with or without consideration, for personal use or the use of others"
The Article (2) of the Federal Law Number 24 of 2006 provides for the set up of a committee regulating the protection of the consumers called as 'Higher Committee for Consumer Protection.'
Article (4) of the Federal Law Number 24 of 2006 lays down the responsibilities of the Consumer Protection Department, and it states as:
- "There shall be set up at the Ministry a Department called the "Consumer Protection Department." The Department shall have the following responsibilities:
- Oversee the implementation of the general policy for Consumer protection in cooperation with the relevant authorities in the UAE.
- Coordinate with the relevant authorities in the UAE to combat illegal trade practices which harm Consumers.
- Coordinate and cooperate with the relevant authorities in raising Consumer awareness of Goods or Services in the UAE and acquainting Consumers with their legal rights and the means to assert them.
- Monitor the movement of Prices and currencies in order to control inflation.
- Promote fair competition and eradicate monopoly.
- Receive Consumer complaints about processing or referral to the relevant authorities. Complaints may be filed either directly by the Consumer or on his behalf by the Consumer Protection Association.
- Publish decisions and recommendations that promote Consumer awareness."
Chapter Five of the Federal Law Number 24 of 2006 deals with the rights of the consumers and it provides for the right to recover compensation for personal injuries and damages as per the law in force.
Under the UAE laws, the following rights of the consumers are protected:
- Right to Choose
- Right to Representation
- Right to Safety
- Right to be Informed
Therefore, the UAE has granted adequate protection to consumers against unfair practices, monopoly, and fraudulent actions.
Consumers not only occupy a larger sphere in the economy but are also at the base of all activities concerning trade and commerce. They not only consume a wide variety of products but also make a difference in the standard of living in a society. Without consumers, there would be no demand in an economic system. Growth and development of a country increase the level of consumption and, therefore, consumer protection are necessary to safeguard the interest of the consumers.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.